Social Care Cost Cap Brought Forward – and other Budget News
The Chancellor has announced that the cap on Social Care Costs will be introduced a year earlier than originally intended in 2016 and the amount of the cap will be reduced from the planned £75,000 to £72,000. The threshold for the means test on residential care will also increase from just over £23,000 to £118,000 in that year too. The Budget document suggests that an additional 100,000 people who do not receive any support under the current system will be helped. However, the response to this announcement was muted. Michelle Mitchell, Charity Director General at Age UK said, “Whilst we welcome the earlier implementation of the care cost cap to April 2016, this will do nothing to help the 800,000 older people who need help with everyday tasks but received no formal support.”
The Budget also contained an announcement that changes in the state pension have also been brought forward to 2016. Under the new scheme the basic minimum will rise from the current £107.45 to £144.
The amount you can earn before tax is also rising. The threshold will rise to £9,440 next month and will increase again, to £10,000, in 2014.
Also included in the Budget this year was an exemption for beer from the current alcohol tax escalator and a reduction of 1p in the amount of the current duty. Other alcoholic beverages were not included in this largess and the duty on these will continue to rise at 2% above inflation.
For those who drive the news that a planned 3p rise in fuel duty due is September has been scrapped is good news.
There is also some help for those who bought Equitable Life Policies before 1992. They will receive an ex gratia payment of £5,000 with an additional £5,000 for those on the lowest incomes (i.e. those who receive pension credit).
There are two schemes to help home buyers. From 2014 the current FirstBuy scheme will now be available to all buyers, not just those buying their first property and provides an equity loan that is interest free for the first 5 years. There will also be Government guarantees available for new mortgages on properties up to the value of £600,000.
All in all this year’s Budget was a low key affair, with few surprises, but at least the Chancellor stayed away from pasties!